Bank of Nova Scotia, Canada’s third- largest bank, plans to offer small loans and credit cards to consumers in Mexico with little or no banking history to increase its share of business in the country.
Scotiabank, which operates in about 50 nations, has consumer-finance operations in Peru,Chile, Guatemala and the Dominican Republic, said Wendy Hannam, executive vice president, sales and service, products and marketing for the lender’s international-banking unit.
“We are looking right now at Mexico, because it’s the single-biggest population base for that business,” Hannam said in an interview in Toronto. “We’re at the early stages of building out that capability.”
About half of the 100 million people in Mexico, where Scotiabank runs the nation’s seventh-largest commercial bank, are “underbanked,” Hannam said. The company would offer its products through retail stores, as it does in countries such as Peru, and would target households with monthly income of less than $750.
In Peru, “we have arrangements with the stores to offer small, tiny loans to purchase the good that the consumer is looking at, whether it’s a TV or a purchase of five, six hundred dollars,” said Hannam, who was promoted to the position in September 2009 and has been with Scotiabank since 1983. “That would be a good way for us to enter that market in Mexico.”